Law: Income Tax Act, 1922

Section: 26A

Law: Income Tax Rules, 1922

Section: 22(4)(ii),11A

Income-tax Act (XI of 1922)---S. 26-A--Income-tax Rules, 1922, R. 22(4)(ii) & Form 11-A-¬Registration of firm granted under S. 26-A, cannot have the effect of continuing the registration--Where change in constitution of firm was made on last day of previous year relevant to the assessment year and application for registration was filed in September (next year) under the new legislation, such application for registration, held, was valid as the firm was in existence throughout the length of previous year in relation to the first assessment year under the new legislation. JUDGMENT SABYASACHI MUKHARJI, J.--This is an appeal from the decision and judgment of the High Court of Patna, dated 23rd November, 1973. The appeal is by certificate from the High Court under section 261 of the income-tax Act, 1961, hereinafter called the Act. The assessee firm was registered in 1945 under the Indian Income-tax Act 1922. The registration was upto the assessment year 1961-62. There was a change in the constitution of the firm on the last day of the previous year relevant to the assessment year 1962-63 on 8th November, 1961. From November 9, 1961, a new instrument of partnership came into existence. On September 29, 1962, the firm applied for registration under the Act in Form 11-A. The Income-tax Officer refused registration on the ground that the case fell under section 184(7) of the Act. The Tribunal thereafter upheld the order of the income-tax Officer. There was a reference to the High Court. It was held by the High Court that the application was filed in September 1962. On that date the constitution of the firm had changed. The application for registration under the 1961 Act was for registration of the firm, which was in existence throughout the length of the previous year in relation to the first assessment year under the Act of 1961. That being so, in accordance with rule 22 (4) (ii), income-tax Rules, the application filed in Form 11-A was a good and valid application. 2. The High Court, further, observed that the scheme of renewal of registration under the Act of 1961 was different from the one that obtained under 1922 Act. Under the Act of 1922, application for…

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